Unions welcomed today's announcement that hundreds of jobs will be created in Sunderland where Nissan will build its electric car, the Leaf.

The Unite union said the move was a "huge vote of confidence" for Britain's car industry. "It secures thousands of skilled jobs and puts Britain at the heart of a greener future for the automotive industry," said Derek Simpson, Unite joint general secretary.

"The government's financial support is proof that Labour is prepared to act to support jobs and green manufacturing. Tory policy on British manufacturing is to do nothing."

Nissan, Japan's third-biggest carmaker, said the Leaf would be the world's first mass-produced zero-emission car. About 50,000 will be made in Sunderland each year, as well as 60,000 batteries, creating more than 550 jobs.

Production of the five-seater hatchback, due to be launched next March and capable of running 100 miles between charges, will begin in 2013 in Sunderland and forms part of a £420m investment by the Japanese company in its UK operations.

Sunderland had been tipped as favourite for European production of the Leaf since Nissan sited its electric car battery plant nearby. Founded in 1984, Nissan's Sunderland factory employs about 4,000 people.

Also today, the government said it will back Ford's £1.5bn investment in creating a new generation of environmentally friendly engines. The government will provide £380m in loan guarantees towards six Ford projects through its automotive assistance programme. The guarantee will back a proposed loan of £450m which is being considered by the European Investment Bank.

Ford's plans will safeguard around 2,800 highly skilled jobs in the UK at its factories in Dagenham in Essex, Southampton in Hampshire and Bridgend in Glamorgan and its research and development centre at Dunton in Essex. The support will cover R&D for Ford's commercial vehicles such as the Transit and Connect vans and the development of low-carbon-emission diesel and petrol engines.

Nissan's investment will be supported by a £20.7m grant from the UK government and a proposed finance package from the EIB of up to £197.3m.

The move was welcomed by the business secretary, Lord Mandelson. He said: "This investment is a fantastic vote of confidence in the Sunderland plant and its excellent workforce. The automotive sector is of key importance to the UK. It supports R&D, technological innovation, skills and a supply chain that's a mainstay of the wider manufacturing sector.

"Today's news from Nissan, with support from government, shows that by working together we can achieve our aim of making the UK a world leader in ultra-low-carbon vehicles."

Andy Palmer, senior vice-president for Nissan's global electric vehicle strategy, said: "Thanks to the UK's firm commitment to a low-carbon future in terms of infrastructure, customer incentives and educational programmes, the Nissan Leaf will be built at Sunderland, making the UK the third country in the world to produce this revolutionary car."

Government support for Nissan and Ford follows last week's announcement of a €300m (£270m) loan guarantee to General Motors Europe, helping to secure the company's UK operations in Ellesmere Port, Merseyside, and Luton and Millbrook in Bedfordshire.

Dr Simon Harrison, chairman of the Institution of Engineering and Technology's energy policy panel, said: "Mass electrification of vehicles will require the full roll-out of smart grids to manage network capacity. There wil also need to be a mass roll-out of charging infrastructure nationwide."

About this article

Nissan's Sunderland factory to build new electric car

This article was published on
the Guardian website
at 08.44 EDT on Thursday 18 March 2010.
It was last modified at 15.50 EDT on Wednesday 11 June 2014.
It was first published at 04.11 EDT on Thursday 18 March 2010.